The Theory Of The Firm Under Perfect Competition is a chapter that briefs about the competition between a large number of buyers and sellers, who sell analogous products at the same price. This chapter comprises of different concepts – Perfect Competition, features of Perfect Competition, price line, revenue – total revenue, average revenue, marginal revenue, profit, break even point, shutdown point, short run supply curve, meaning of supply, supply schedule, supply curve, elasticity of supply.
Frequently asked Questions on CBSE Class 12 Microeconomics Notes Chapter 4: The Theory of The Firm Under Perfect
What are the features of ‘Perfect Competition’?
1. Maximum number of buyers and sellers 2. Uniformity in product 3. Proper knowledge in all aspects 4. Perfect mobility 5. Absence of transportation costs
What is ‘break even point’?
The break-even point is the point at which total cost and total revenue are equal i.e, no loss or gain.
What is ‘shutdown point’?
A shutdown point is a level of operations at which a company experiences no benefit for continuing operations and therefore decides to shut down temporarily, or in some cases permanently.